Will Russia’s pivot to Africa from Egypt succeed?

Trade between Russia and Egypt, which has increased in recent years, will soon receive yet another major boost: the two countries are preparing to sign a bilateral agreement on the creation of a Russian industrial zone in the Egyptian city of Port Said, located on the Suez Canal.

The document is expected to be signed in May, possibly on the 23rd. Investments in the first Russian industrial area abroad will be approximately $7 billion.

It is a unique project for Moscow, and experience with Egypt can serve as the basis for other similar projects, said Veniamin Popov, director of the Center for Cooperation among Civilizations at the Moscow State Institute of International Relations (MGIMO).

Russian-Egyptian Business Council chairman Mikhail Orlov told the Russian Chamber of Commerce that trade between the two countries has increased four or five times in recent years, and this is a priority for Russia.

“We are very grateful to the Egyptian government for being willing to cooperate in Russian projects aimed at strengthening economic relations between the two parties,” he said. “It is about food, agriculture, medicines and energy, especially the construction of the Russian nuclear power plant in Egypt.”

The idea for the project came in 2014 following the meeting of Russian President Vladimir Putin with his Egyptian counterpart, Abdel Fattah al-Sisi. In 2016, the initiative was finalized and the document will be signed already this year.

It is a long-term initiative. According to previous estimates, the creation of the Russian industrial zone in the Suez Canal area will take 13 years.

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However, it is expected that from 2026 the production of the area will be valued at approximately US $ 3.6 billion (R $ 12.8 billion) per year.

At the moment, the greatest interest was expressed by Russian pharmaceutical and automotive companies.

In addition, heavy machinery manufacturers consider transferring a part of the production process to the new zone in order to reduce costs and facilitate deliveries of their devices to partners on the continent.

An important cause for Moscow’s interest in the area is the possibility of entering the Egyptian market as a privileged partner. Cairo, for its part, will receive immediate access to high-tech Russian products, as well as significant investments and thousands of new jobs for its citizens.

In addition, access to the Suez strategic channel will give Russian companies the opportunity to export their industrial products more easily across Africa, southern Europe, the Persian Gulf and even to more distant regions such as Latin America.

Al-Sisi assumed power in June of 2014 as the result of a popular and military revolt against the US and Turkish puppet, Morsi. Al-Sisi’s move into power was backed by Russia and Saudi Arabia. Saudi Arabia was interested in balancing regional geopolitics away from Turkey, even though Turkey and Saudi Arabia are both involved in the invasion of Syria. The US installed Morsi in June 2012 by staging a ‘Color Revolution’ in Egypt to remove Mubarak, as the then Egyptian government was unwilling to support the invasion of Syria, despite that Mubarak had been a generally trusted ally of the United States, and worked with Israel to contain Palestine.

Since the rise of al-Sisi, Egypt has remained relatively neutral, and has benefited from balanced relations with Russia and the Saudis. As a result, Russian designs to build stronger economic ties with Egypt as a pivot into the rest of Africa is, on the face of it, realizable in terms of the status of the relations between Putin and al-Sisi.

Paul Antonopoulos is a Research Fellow at the Center for Syncretic Studies. He has an MA in International Relations and is interested in Great Power Rivalry as well as the International Relations and Political Economy of the Middle East and Latin America.